The French Do It Better for Half the Price

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Anyone trying to follow the latest battles in the health care debate will by now find their heads swimming with claims and counter claims, unintelligble lingo, political doubletalk, and mind boggling statistics. It all serves to distract us from the simplest way to assess various potential health care systems, which is by looking at countries that already have them.

But here, too, politics enters the equation. Conservatives like to produce dire warnings based on the British NHS, which does have a fair amount of rationing. (They don’t mention that 73 percent of Brits nonetheless said they had confidence in their health care system, as compared with 56 percent of Americans, according to a Gallup poll last year.) These same conservatives avoid looking at the very best national health systems, which manage to deliver superior care at dramatically lower cost.

Here’s a very simple run down on the French health care system, often thought to be the best of them all. Much of this information comes from an interview published recently in the New York Times with Victor G. Rodwin, a professor of health policy and management at NYU’s Wagner School of Public Service and an expert on international health care systems.

1. There is no explicit health care rationing in the French system, and access to care is generally excellent. The quality of health care provided in France was ranked first by the World Health Organization and in other recent studies.

2. The model is something very close to a Medicare-for-All system–only better. As Rodwin describes it: “It’s not government run but government financed. Like Medicare and Social Security, it is funded by compulsory payroll taxes with some income tax contributions. But doctors work predominantly in private, office-based, fee-for-service practices, and there is a mix of public and private hospitals. The main difference from Medicare is that the entire resident population is covered and the benefit package is more generous.”

3. France has preserved a role for insurance, although it is nonprofit and heavily regulated. The French buy supplemental insurance, like the Medigap policies bought by many Medicare enrollees, to cover copays and additional services–though they don’t need it for much.

4. The French drive a hard bargain with drug companies, so they pay a lot less for their drugs than we do. As summarized in a report prepared for Democrats on the House Oversight Committee in 2001: “The French pricing system allows pharmaceutical companies to sell their products at any price. However, if these companies want the national health care system to reimburse patients for the cost of the drug, the companies must agree to a lower, negotiated price. These negotiated prices and reimbursement rates paid by the healthcare system are based on the therapeutic value of the drug and the price of the drug in other countries. The French pricing system results in brand name drug prices that are an average of 45% lower than prices inhe United States.” A more recent study put the figure at 48 percent lower.

5. The French system is one of the more expensive in Europe and, as the Wall Street Journaltakes pleasure in reporting, there is controversy about rising costs. Yet according to OECD data from 2007, the per capita cost is still half that of the U.S. system, and the percent of GDP spent on health care is about 30 percent lower–11 percent as compared with our 16 percent. This cost difference makes the various cost-cutting schemes proposed by Congressional Democrats look like chump change.

Fact:

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